SHARE

Man to serve decade for real estate investment scheme

GLENWOOD SPRINGS — A Silt man received a 10-year prison sentence today in connection with a scheme in which some investors lost life savings, after telling a judge that manic episodes contributed to his actions.

“This is not an excuse, I did what they say and I am worthy of this punishment but there is a reason for it, it isn’t random,” Craig Davis, 62, told Ninth Judicial District Judge Denise Lynch after apologizing to victims during his sentencing hearing.

Davis was accused of defrauding investors of a total of at least $1 million, and possibly as much as $5 million. He pleaded guilty to two felony theft counts under a deal allowing a maximum 10-year sentence, which the prosecution sought.

Assistant 9th Judicial District Attorney Scott Turner called 10 years “a small price to pay” for the harm caused victims.

“Judge, we’re talking millions of dollars here which will never be paid back,” Turner said.

Davis used investor money to provide nontraditional construction lending to people unable to get traditional loans. The loans were secured through assignment of a deed of trust to investors, and investors were paid off once construction occurred and the borrowers secured traditional loans.

However, in 2007 Davis began using the amount to be repaid to investors for other purposes, including building homes he hoped to sell, and he also sometimes failed to record the assignments of the deeds of trust to investors.

Davis said his change in behavior was due to a then-undiagnosed bipolar condition that triggered manic episodes when he went on thyroid medication.

“The manic episodes were extremely high and I thought I was king of the world,” he said.

He said he was so “up” that investors “started throwing money at me.” He put money into a housing development that foundered once the real estate market turned. Investor Israel Argueta said through an interpreter in court that he was supposed to be a lienholder in that project, but Davis never made a record of it.

“And then the property went into foreclosure and there went my $300,000,” Argueta said. He also lost $100,000 he invested with Davis earlier.

Trent Thompson told Lynch his father, Dr. Richard Thompson, died three years ago after suffering a stroke Trent Thompson believes was related to Davis’ theft of money meant for his father’s retirement.
“I had to tell him his money was gone,” Thompson said.

His father had invested more than $500,000.

Lynch told Davis while some people think a white-collar crime doesn’t hurt people like a violent crime does, it’s not a victimless offense.

“It does have a severe impact on people’s lives, even though they’re not physically injured,” she said.